The Retailing Industry, Which Is Most Resistant To Cyclical Recession, Is In A Predicament.

Under the environment of low consumption and electric shock, China's retail industry has not only failed to deliver high growth performance in the past year, but also faced with the difficult situation of closing stores, adjusting and declining profits. < p >

The expansion of traditional large department stores and large supermarkets is gone forever. In the face of the fact that sales of goods have dropped sharply, cost increases and profits have dropped, their expansion speed has slowed down obviously. The market performance is that new stores have been reduced, and some shops which are hard to manage are even forced to close.

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< p > statistical data show that in 2012, WAL-MART, Carrefour, TESCO's new shop speed decreased by an average of less than 27%, in addition, the main foreign chain enterprises also closed nearly 30 stores.

In December 28, 2013, Dominic (DOMINICK), a 100 year old store in Chicago, was closed and more than 6000 people in 72 stores were unemployed, including many old employees who were about to retire.

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"P" in the country, because of the price of commodities, consumers to daily consumption has also begun to become rational, and even in some commodities have become more "small".

Coupled with the rise of the electricity supplier, a large number of consumers are attracted to the ranks of online shopping.

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Under such a background, although many retail stores have adopted attractive promotional measures, some have already pformed to electric business, but the retail market is still clouded with P.

How to break through the difficult retail business? < /p >

< p > < strong > Guan Dian Chao continued < /strong > /p >

< p > the last two years, the domestic retail industry has been in a slump, and the tide of closing shop has been spreading.

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< p > in March 19th of this year, WAL-MART Jiangsu Yancheng store and Hunan Changde store closed at the same time. This is the second time WAL-MART has closed stores since March this year.

Prior to March 4th, WAL-MART Chongqing South Bin shop officially ceased operation.

According to the announcement issued by WAL-MART in Ma'anshan, the two shops will be closed from March 31st.

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Li Yingnan, WAL-MART regional director of China, said in an email to the media that WAL-MART has a 9% weight reduction plan in China. According to the rigorous market assessment, WAL-MART will close some stores with poor performance.

WAL-MART said earlier that it plans to close more than 20 stores with poor performance in China this year, while upgrading some of its stores.

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< p > in fact, it is not just a large supermarket like WAL-MART.

Since the second half of last year, supermarkets, convenience stores and department stores have begun to shop, and this "shop tide" has been spreading throughout 2013.

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< p > in the form of convenience stores, Rosen first closed about 30 stores, leading to its total number of stores for many years has been hovering around 300.

After that, we can start adjusting and closing dozens of stores with good.

It can belong to the Shanghai agricultural industry and Commerce Group under the command of good virtue. The total number of the two businesses has more than 2000 stores. It is the largest convenience store in the country.

However, after this year's adjustment, according to the insiders of Nong industrial and commercial group, the number of total stores with good virtue has been less than 2000.

Even 7-11 of the "positive energy" sense has been proposed to close and adjust nearly 20 stores.

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By contrast, the days of being squeezed into standard supermarkets between large stores and small convenience stores are even more painful than P.

Because of the economic disputes this year, the number of stores that have been forced by the supplier to "drive the palace" has been reduced to 160 from a few years ago to about 140. The new shop is very slow, and only 6 new stores are opened in 2 years.

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Less than P, department stores are also hard to escape.

In March 2013, the famous Fangzhuang department store, a well-known department store, shut down its shop in Fangzhuang. In the middle of the year, the Shijiazhuang department store of the Department of oceanic was closed, and Ishi Dan, which had been operating in the country for 5 years, shut down, and entered the scorching summer. The Pacific department store, which was entrenched in Chengdu's business district for 20 years, was closed, while the Pacific's "old hands" Baisheng was not much better; after the closure of Baisheng Guiyang fresh flower shop, a store in Baisheng Shijiazhuang was closed at the end of August.

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< p > affected by the rapid expansion of earlier channels, some brand clothing enterprises also keep on closing.

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< p > under the impact of fast fashion brands such as ZARA, H&M, UNIQLO and so on, once the fashion benchmark ESPRIT brand has slowly fade out of people's view, the flagship store has also become a continuous discount shop.

Metersbonwe, Giordano, I.T and other fashion brands have encountered severe challenges.

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< p > the Hongkong clothing brand I.T has released the interim report of the 2013/2014 fiscal year, which shows that in the first half of the fiscal year, its group's net profit fell by 76.8%, while the losses in the mainland market were as high as HK $14 million, which made I.T have to close 43 stores in Hongkong and the mainland.

In addition, the number of stores in 2013 was more than 200, and the number of stores in the mainland in the first half of 2013 decreased by 180 in 2013.

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< p > data show that since 2013, the number of sports brands such as China, 360, Anta, PEAK and XTEP has closed more than 6000 stores.

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P is more and more difficult to make profits. On the surface, WAL-MART's downsizing is to adjust its strategy, but the reason behind it is that profits are too low and profits are becoming more and more difficult.

This is also the common reason why a large number of retail brands have been closed.

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< p > "high cost is the key to making the profit of retail business more and more difficult.

In 2013, the rise in the cost of retail industry appeared from the slow to the urgent and the rigid proportion increasing. If a certain critical point is reached, it will have a fatal impact.

Guo Geping, President of China Chain Store Association, said that in the first half of 2013, a number of retail listed companies reported that over 80% of the sales and administrative expenses of enterprises rose, while the growth of retail enterprises was slower than the cost increase.

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< p > 2013, the cost of retail industry increased from slow to urgent and rigid.

Data show that more than 80% of the enterprise's sales and management costs are rising, but the growth rate of retail sales is obviously slower than the cost increase.

Its specific performance is: first, the increase in labor costs, especially the pay of high-end talents; two, the increase in operating costs is greater than the monthly profit increase, such as staff recruitment costs, new shop decoration, shop promotion, rental of water and electricity and so on.

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< p > professional commercial real estate service RET Rui Yide pointed out that in the process of urbanization, land prices have undergone tremendous changes, and the cost of property construction and decoration has been greatly improved. These have greatly increased the investment budget of retail property, stimulated the higher expectations of the property lessor on rental income, and the labor cost has also increased year by year.

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< p > the profitability of the retail industry is also related to its aging and lack of innovation mode.

Due to the early expansion of the whole industry and the overdraft of market resources, coupled with the lack of standardized marketing innovation mode, the retail industry is showing an aging state.

In the period of meager profits, the industry giants and large retailers are competing. If the retail industry is not featured, it will be hard for consumers to come again.

Without consumption, there will be no turnover; if there is no turnover, there will be no profit; if there is no profit, the enterprise will not be able to sustain it, and its various costs will continue to be paid. In this case, it can only be closed down.

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< p > when the retailer meets the rents of rent and labor costs, the rise of the electricity supplier has made the entities "add insult to injury".

According to AI data, in 2006, the electricity supplier's sales volume was about 26000000000 yuan; in just a few years, the number of electricity supplier sales in 2012 has exceeded 1 trillion and 300 billion yuan; in 2013, only a "double 11", Tmall sales amounted to more than 30 billion yuan, so that the entity industry could not catch up.

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< p > < --EndFragment-- > "because of the high cost, the impact of the electricity supplier and the low consumption, the profit of the entity retailer has become very difficult.

In the third quarter of 2013, the gross profit margin of supermarkets and convenience stores was 15% to 20%, the number of department stores was 20%, specialized shops and specialty stores were 20% to 25%, and the gross profit margin of large supermarkets in the third quarter was only about 15%.

In the third quarter, the gross profit margin of all physical retail formats declined significantly compared with previous years.

Guo Geping said.

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< p > < strong > < a > href= > http://www.91se91.com/news/index_c.asp > capitalization > /a > death > /strong > /p >

< p > because of the difficulty in making profits, more and more retail enterprises begin to "do nothing" and even pursue capitalization one sidedly.

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For a long time, retail companies often get financing through PE (VC) and VC (venture capital).

However, in the slow growth period and low profit margins, the retail industry, especially physical retail, is becoming increasingly difficult to get the favor of capital.

As a result, retail enterprises are starting to build their own investors to resist the risk of small profits or open diversified and comprehensive business operations.

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< p > "in the past, the retail industry mainly relied on extensive and extensive expansion to expand sales growth.

But with the saturation of the market, the cost of this expansion way is getting higher and higher, and the competition is more and more intense. Improper scale expansion will not only affect the profit level or even lead to losses, but eventually have to be bought. "

An industry insider said so.

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< p > capitalization is an essential part of an industry's growth and development, but if it is over capitalized, it will backfire.

President of Beijing, an investment company familiar with the retail industry, said: "what China's retail industry should worry about is not the saturation of the market, but the over saturation of capital."

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< p > an indisputable fact is that in recent years, with the successful listing of BBK, Shenzhen Tianhong, Huiyin appliances, Yonghui supermarket, Wenfeng world, Ningbo Sanjiang and other traditional retail enterprises, many peer enterprises have begun to try their best and hope to set foot on capital journey at an early date.

Some VC and PE joined the chain industry in the past few years. In order to successfully compete for the target enterprises, they even did anything.

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< p > according to an equity investor, through a round of competition and screening in recent years, some companies with better qualifications and quick results have been picked up by VC and PE.

"Most of the hundreds of retail businesses that are expected to run on the market are doomed to failure."

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< p > in addition to retailers' excessive enthusiasm for capital operation, outside industry capital is also carrying out a new round of "mopping up" for the retail industry.

Some capitals almost do not have any choice for M & A objects. They can not eat any food, even a couple's shop or grocery store, regardless of whether they can make profits, whether there is room for investment appreciation in the future, and the premium premium is too high, which has deviated from the basic knowledge of retailing.

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< p > "the retail industry has gradually entered the meager profit era from the stage of barbaric growth and turned to other areas for higher returns."

Huang Huajun, Deputy Secretary General of the Guangdong provincial Circulation Industry Association, said that only the retailer's main business could not be vacant and diversified, but the primary and secondary must be distinguished.

The ultimate goal of capital is to cash in and seek profits instead of long-term sustainable development of the industry. This will overdraw the future prospects of the retail industry, for example, the excessive earnings of listed companies will overdraw the growth space of the next few years.

Moreover, due to excessive pursuit of capital operation, many retail businesses have lost interest in industry, and have switched to commercial real estate or other industries.

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< p > at present, a large number of physical department stores are still joining the electricity supplier, but their operation is always facing difficulties, especially the self built platform of some physical department stores.

How to locate and develop Internet retail has become a predicament for the traditional retailing industry.

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During the "double 11" period of < p > strong > 2013, the electricity supplier was further "attacking the city" < /strong > /p >

< p > taking Chongqing department store as an example, the "online shopping" of the company which has been publicly tested in mid 2012 is still under construction.

It is understood that Chongqing department store has hired internationally renowned information organization Roland Begg management consulting (Shanghai) Co., Ltd. for its development strategy, in order to better adapt to online retail.

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"P", for the traditional department stores and traditional enterprises electric shock, dark horse has been reported many times.

However, traditional enterprises are facing a dilemma now. They will not be able to change the trend of electricity supplier and users' habits. But they do not know how to start and how to face the situation of self revolution.

Indeed, traditional enterprises are facing this kind of real game dilemma.

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People in the industry believe that the development of online retailing in traditional retail department stores is a trend without doubt. However, they have to face the problem of low gross profit and some other problems, so that some enterprises are caught in a dilemma of P.

The result of this mentality is that these enterprises are forced to take part in the construction and investment of online retail, but they are relatively cautious in the allocation of funds and resources, and the linkage reaction of the executive layer is also wavering.

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< p > in fact, the profit pressure of physical retailers after "touches the net" has never been broken. Some supermarket businesses that have been involved in online businesses have little breakthroughs, and some traditional department stores have also become "chicken ribs".

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The report of China Chain Store Association (P) shows that online sales of "touch net" retailers are far from being formed.

From the sales point of view, in 2012, 62 of the top 100 chain stores launched online retail business, with less than 35 billion yuan in total sales and accused of "less than the sales of a professional electricity supplier of Jingdong".

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< p > there are 60% enterprises whose network sales volume is less than 5 million yuan.

From the daily average orders and operating single products, 79% of the enterprises average daily orders less than 500; the number of single products is also less; 71% of the enterprises in the number of single products is less than 3000, of which 42% of the single enterprise number is less than 1000.

From the point of view of traffic volume, the traditional department store online and the pure electronic business platform are not the same.

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< p > the retail industry also suffers from the shortage of funds and talents.

An industry insider sighed: "in many cases, people who are not very understanding are talking about the e-commerce road of department stores."

This kind of "ignorance" reflects the "trial and error" and "hesitating" of many enterprises to test the water business, and the deep-seated problem is that the investment of enterprises in capital, manpower and technology is far from enough.

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< p > in fact, < a href= "http://www.91se91.com/news/index_c.asp" > electricity supplier < /a > is precisely an industry that integrates capital and manpower. The development of traditional retail industry is facing many links such as technology, operation, promotion and so on. It needs a lot of capital investment. At present, the investment of enterprises is inadequate, which leads to weak development.

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< p > "China's a href=" http://www.91se91.com/news/index_c.asp "> retail trade < /a > are all light assets. Touting investment will take 3~5 years to bear fruit, which will bring greater financial pressure to retail enterprises.

The industry insiders said.

According to its introduction, the traditional retail enterprises are not all rich in money, many enterprises lack obvious ability in capital investment, and the enterprises with less than 500 million yuan annual turnover can hardly replicate the mode of large enterprises.

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For example, a retailer with an annual sales volume of 5 billion yuan, for example, has a profit margin of 2%, which belongs to the medium to upper level of the industry. Its annual profit is 100 million yuan. P

If it wants to do something in the electricity business, the initial investment must be tens of millions of dollars.

If we want to develop rapidly, we need to invest more every year, and half or more of our profits should be invested in the electricity supplier.

Therefore, the surplus profit has been insufficient for the expansion of enterprises, let alone to resist sudden market risks.

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< p > it is gratifying to note that under the tide of exploring the O2O mode, the traditional retail trade collective net has become a fact.

Unlike the original trend, businesses are now exploring their own O2O models in combination with their own situations.

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